Bill that could bar Ashcroft from Lords likely to fail

A backbench parliamentary bill that could have excluded the multimillionaire Tory donor Lord Ashcroft from the Lords is likely to fail after Labour and the Tories joined forces to reject the measure.

The bill, introduced by the Liberal Democrats' Treasury spokesman, Lord Oakeshott, would have tightened tax laws to make sure that only full British taxpayers resident in the UK could sit in parliament's upper house.

Under the bill, peers would have to "resident, and ordinarily resident and domiciled, in the UK and no other country for tax purposes".

The measure - the House of Lords (members' taxation status) bill - ran into trouble when the Conservative and Labour frontbenchers dismissed it during a debate in the Lords on Friday.

Lord Strathclyde, leader of the Conservative party in the Lords, who had earlier voiced support for the bill, accused Lord Oakeshott of being "swift to jump on a bandwagon". He said the Tories would not support the bill but rather back a government measure dealing with the issue, or a separate Commons bill that is being piloted by the Labour backbencher Gordon Prentice, and which would be "less draconian".

Lord Strathclyde said: "Once you start down this road, there are all too difficult issues and many stones to overturn, so we on this side of the house will give positive consideration to legislation that may be proposed by the government.

"We will look at improving the Prentice bill if it reaches [the Lords] but we will not play bit-parts in a bill designed as a prop for press releases by [Lord Oakeshott], who has already filled pages on Google before even explaining his bill to [the Lords]."

The government indicated that it could not support Lord Oakeshott and was more interested in the Prentice bill.

Lord Hunt, the legal aid minister, said: "We support the 'no representation without taxation' principle; we support the intentions behind the bill, and would not seek to oppose the bill's progress in [the Lords] because it is not appropriate for the government so to do.

"However, at this stage, we do not consider the bill, as it stands, to be an appropriate vehicle to support."

Lord Oakeshott said he was disappointed that Lord Strathclyde was not backing his bill. "My bill is not a publicity stunt. It is a serious bill with substantial support to stop behaviour which besmirches our house."

Lord Strathclyde declined to say whether the bill would have an impact on Lord Ashcroft. "Every political donation he has made has been found to be in accordance with the law," he told peers.

A spokesman said last month the bill would have no effect on Lord Ashcroft. The peer, who has business interests in Belize, has not spelled out his tax status.